Rupiah weakens amid geopolitical uncertainty in the Middle East

Currency analyst Lukman Leong from Doo Financial Futures said the rupiah weakened amid geopolitical uncertainty in the Middle East.

The rupiah’s exchange rate against the US dollar at the opening of trading on Tuesday (11/8) moved down 40 points, or 0.23 percent, to Rp17,795 per US dollar, compared with the previous close of Rp17,755 per US dollar.

“The rupiah is expected to weaken against the dollar amid geopolitical uncertainty in the Middle East, which has again pushed up global crude oil prices. It is currently at 83.21 US dollars per barrel, compared with last week’s close of 77 US dollars per barrel,” he told ANTARA in Jakarta on Tuesday.

A report from Anadolu revealed that Iranian Foreign Ministry spokesman Esmaeil Baqaei said the Strait of Hormuz would not be reopened until the United States meets Iran’s demands, including ending the naval blockade of Iranian ports.

The statement was made as negotiations over the future of shipping through the Strait of Hormuz remain deadlocked.

Iran has held talks with Oman and reached an understanding on a shipping route map, and consultations are still ongoing to resolve a number of technical points in a joint statement. Several mechanisms will be established to ensure the safety of maritime traffic, protect the environment, and address “maritime crimes.”

Another sentiment came from investors awaiting retail sales data, which is expected to grow by 1.8 percent.

Based on these factors, the rupiah is predicted to trade in the range of Rp17,750 to Rp17,850 per US dollar.